How to Budget for a Home Remodel
By Great Lakes Window
It’s easy to envision the home of your dreams. A spacious outdoor patio, easy-to-open energy efficient windows, a beautiful new kitchen and spacious walk-in closets. OK, maybe those are just our dreams, but you probably have some of your own, too. When it comes to budgeting for your home remodeling project you have to be realistic about what you can spend and the areas you can afford to splurge in. The simple part is imagining that dream home, the hard part is determining how much these improvements are going to cost and how much you can actually afford to spend.
First, establish your budget before anything gets started.
Having a budget will allow your remodeling team to present you with the best materials in your price range. While you may not fully understand how much it will cost for the remodel you are interested in, you need to approach the project with a dollar amount that you are comfortable spending. That amount will determine the scale of the remodel and the materials your team recommends. Without a budget, they may come back to you with a ballpark estimate that is double what you were hoping to spend. It is best to get ahead of this in the first place to avoid wasting time.
Do you watch a lot of home remodeling shows?
Forget what you’ve seen. While those shows are great for idea generating and inspiration, they can set unrealistic expectations about how a home remodel should go and what it will cost. Your remodeler will offer you the best advice on what is realistic for your budget. They are familiar with the costs of different materials and the labor estimates for various projects. The 2015 Cost vs. Value Report compares the average cost for 36 popular remodeling projects. This will give you a sense of where your project will land. Whether you are budgeting for vinyl replacement windows, a bathroom remodel or a roofing replacement, this will give you an idea of where prices fall in your area. You can search project costs nationally or by region.
Have your budget ready?
Give yourself some cushion. It is recommended that you try to build in a 20% buffer to cover any surprises that pop up during the remodel. With the uncertainty of construction projects, there are almost always situations that will pop up that end up increasing the cost. These are usually tough to see at the start of a project, so having that 20% contingency can really alleviate stress during the process.
Start collecting quotes from contractors.
Now that you know how much you have to spend and what you plan to spend it on, gather bids from the teams that will be working on your home. Make sure you call references, check out their portfolio of work and look at their reviews online. Consider these 7 questions to ask your contractor if you are replacing your home windows.
What the heck are hard and soft costs?
You need to know what you are paying for. Your contractor and designer will help you understand the different costs and explain what every number means. Hard costs are the costs of construction materials and other concrete items used to build the structure. Soft costs are for things like permit fees and designers. There is nothing wrong with meeting with the project manager that is running the remodel to better understand what all of these fees mean. Construction workers have a different way of figuring out costs than designers. For example, construction is typically explained in dollars per square foot, while a designer is thinking about the costs of actual appliances. Receiving an estimate from a contractor may only include the construction hard costs and not take into consideration the soft costs. It is important to understand the big picture to make sure you are staying within your budget.
Now you are even more aware of how important a remodeling budget is. No one wants to run out of money before their project is complete due to unrealistic expectations or unforeseen circumstances. There is nothing wrong with having a contractor come out to your home to give you a bid for a project you have been dreaming about. Introducing someone to what you are wanting to do with your home, doesn’t mean you have to sign on the dotted line that night. It could set you up to receive communication about deals or specials that contractor may offer in the future. It also gives you a good idea on whether or not your budget is realistic.
Meeting with the contractor or dealer will set you on the right path towards your remodeling dreams. Setting a realistic budget and giving yourself that 20% buffer, hiring a dependable remodeler and understanding all of the costs that are part of a remodeling project are crucial to having your remodel run smoothly and staying within your budget.